5 September, 2023 – S&P International Scores (S&P) has upgraded the long-term issuer and concern credit score rankings on Lenovo (HKSE: 992) (ADR: LNVGY) to ‘BBB’ with a steady outlook, reaffirming the effectiveness of the corporate’s clever transformation technique.
In response to the S&P report, Lenovo’s credit standing improve demonstrates the corporate’s “improved operational resiliency, with stable profitability and money movement regardless of declines in PC income”.
“Lenovo’s rising service and options income and good working capital administration will contribute to steadier money movement,” in line with S&P. The credit score company is seeing a steady outlook for the corporate, with income anticipated to develop over the subsequent 24 months from a gradual PC market restoration and a gentle improve in non-PC and providers revenues. S&P highlights the success Lenovo has had in rising income from providers, noting that the upper margins, upfront money funds, and recurring nature of this a part of the enterprise have contributed to the development of Lenovo’s total profitability and money movement in a weaker macroeconomic atmosphere.
“The sturdy upgraded ranking reaffirms the effectiveness of our transformation technique and diversified progress engines,” stated Hugh Wu, Company Treasurer, Vice President of Lenovo. “We’re dedicated to persevering with to drive innovation and clever transformation, to attain long-term sustainable progress and profitability.”
The improve got here after the corporate’s current FY2023/24 Q1 earnings announcement which reported sturdy progress of its services-led enterprise, as properly a dedication to investing an additional US$1 billion in AI innovation over the subsequent three years.
Along with S&P, Lenovo is at the moment rated ‘Baa2’ by Moody’s with a steady outlook; and ‘BBB’ by Fitch with a steady outlook.
